What is the State of Self Storage Today? What are the Benefits of Joining a Mastermind?

How to find and assemble large projects? What are the real estate market trends? Victor Menasce, an author, real estate developer, and host of the Real Estate Espresso Podcast, shares his knowledge.Read this entire interview here:You have many projects right now, one in particular is huge. How did you get it? How did you put it together? And what are some of the good, bad and the ugly that so far has happened?Every single one of our significant projects has landed in our lap. Somebody says, "I've got this deal. I don't know what to do with it. Can you help?" This was a huge property on the edge of Colorado Springs, it's 77 million square feet, and the perimeter is about seven miles.Someone approached us who got it under contract, he didn't have the money to put it together, and had negotiated a reasonable price of 10,000 an acre, about 23 cents a square foot. If you look at agricultural land anywhere across the United States, it will vary between 3 to 10,000 an acre, depending on where it's located. If you're growing weed on it, it's maybe towards the higher end of that spectrum. I typically talk about the entitlement multiplier that comes with land because it's just dirt, why is this dirt worth more than that? It's because of what you can do with it. An agricultural land, 3 to 10,000 an acre, if it's entitled for development, and maybe you can put a subdivision on, it might be a couple of 100,000 an acre. If you can put a 40-story building on it might be several million an acre, but it's all still the same dirt. If we can transform this from agricultural land into the growth path for the city of Colorado Springs, we can probably create a reasonable multiplayer value.We took over the contract, we renegotiated it, and got it re-signed with us. We negotiated a fairly lengthy closing period, which included the entitlement. It had some timelines associated with it, so the sooner the entitlement or the expiration. We did not meet the entitlement timelines that we were originally expecting, based on conversations with both the county and the city of Colorado Springs, that this is something that would be pretty quick. It has turned out to not be quick, but it's still an amazing project.Where is the market today? Are the deals better? Is it time to buy?I wouldn't say that it's better in the sense that there's less insanity than there was because I think we would all acknowledge that many of the valuations that we witnessed in 2021, 2022, and parts of 2023 made no sense at all. I think reality is setting in for many of those and that's going to create distress for a number of those. If you think about folks who would have started a project, maybe a value-add project in 2021 with certain interest rate assumptions, with assumptions about rent growth, etc, they find themselves in a very different world today, probably with no path to get into permanent financing without writing a massive check. And initially, they were probably thinking they were going to get a significant cash-out to refinance, but it's going the other way.I think the lenders are still in a mode of "extend and pretend", bridge lenders in particular. The forecast flood of deals is a trickle, not a flood yet, I think it's coming but a lot of lenders don't want to recognize distress on their books. We are starting to see valuations become more reasonable. We are evaluating deals daily. We are looking right now at two projects that are significant opportunities for office-to-residential conversions at a decent price.Victor MenasceThe Real Estate Espresso...

How is self-storage doing today? What are the benefits of joining a mastermind? Scott Meyers, founder and CEO of Self Storage Investing , shares his knowledge with us.Read this entire interview here: https://tinyurl.com/rt4pvac2You have been doing self-storage for 20 years, how is self-storage doing today?We're bullish on storage. It doesn't matter what the economy's doing, because our asset classes are largely unaffected by what's happening when things are good, people buy more stuff and there's a need for storage so we do well. When there's a contraction in the economy and people are losing their jobs or businesses, it is going a little slower. They have to put their inventory in storage, or they sublease their office or whatever their business looks like and we benefit from that, as well. We are heading into a time that we've been preparing for years, which is kind of the intersection of all that. Interest rates are a little higher and the cost of capital is higher but we are seeing a contraction in the market, which is causing people to downsize businesses.I heard this morning that in Austin, Texas 20% of the workforce is unemployed right now. Some of these companies are laying their people off. But there is a pullback right now, and the jobless rate is a little higher than even what the government statistics would show because we're seeing it and feeling it in the marketplace.Do you think self-storage is being overbuilt in places?You can't say that the industry is overbuilt. If everybody's rates all across the country, were going down and everybody was at 50% occupancy, maybe, but I don't think that we would ever get to that standpoint. There are lots of safeguards in our industry and we do know what it takes to do our homework and understand as developers, what makes this successful self-storage development project. With today's very difficult capital markets: appraisers, lenders, and private equity partners, they are not just throwing money at us, assuming it's going to win, they are forcing and they want to see our feasibility studies and the demand studies that we're doing in the marketplace to understand what a deal looks like before they're going to grant us a loan or loan us our limited partners that are going to come alongside of us or the hedge funds and invest with us. We shouldn't be coming forward if we didn't have that, and we really wouldn't get it anyway.What are some things that you have seen happen at your mastermind?A lot of the things that we've seen are things that we've built in an environment in which all the good things that we see in a mastermind can occur and some of that is true. As we take a step back, we recognize that following the Napoleon Hills model, which is when like-minded people come together and operate at a certain level, good things happen. They share best business practices, they can do business together and so from the beginning, that's the way we designed it. And we see other masterminds out there where they'll just accept anybody into the group, as long as they can write a check. We have an interview process, and it's an exclusive group that we've put into place in the mastermind.Scott Meyerswww.selfstorageinvesting.com

Join us for an insightful panel discussion featuring some of the top names in the real estate investment world. In this video, you'll hear from industry veterans Steffany Boldrini, Tom Wilson, Beth Azor, Irwin Boris, and Sarah Sullivan as they share their experiences and strategies in the dynamic world of real estate.Discover how these experts have navigated the ever-changing real estate landscape and learn about their investment portfolios, which span various asset classes such as retail, industrial, multifamily, and more. They provide valuable insights on the challenges and opportunities they've encountered, from dealing with construction costs and interest rates to the impact of COVID-19 on their deals.You'll also gain valuable knowledge about the importance of cash flow and how it factors into their investment decisions. Plus, find out about alternative investment strategies, including leveraging algorithms for trading and exploring the world of forex.If you're looking to enhance your real estate investment knowledge or seeking inspiration from seasoned professionals, this video is a must-watch. Whether you're a seasoned investor or just getting started, these insights will help you make informed decisions in the world of real estate investment.Don't miss this engaging and informative discussion that can potentially shape your investment strategy for the better. Subscribe to our channel and hit the notification bell to stay updated on more expert panels and industry insights.Join our real estate investing club here: www.montecarlorei.com/investors

Today, I'll discuss my second syndication, which was fully committed 2 hours after the webinar, and how this partnership came about.Read this entire interview here: https://tinyurl.com/bden8yy4I met my partner for this syndication six years ago at the Real Estate Guys Summit at Sea. I've always emphasized that the expensive events are the best because everyone there is serious about real estate investing; they are industry veterans who want to connect with like-minded individuals. Most veterans avoid rookie events that cost $300 to attend because attendees are typically early in their careers, and many won't pursue real estate investing long-term.It's crucial to cultivate relationships over time. Beyond learning about real estate investing, observing partners navigate various situations offers valuable insights. From my partner, I learned about his experiences with past partnerships and his dedication to protecting investors' interests. This aligns with my values, as I prioritize investors' funds over my own. Witnessing his integrity in personal interactions and how he handles adversity solidified my trust in him.How did this opportunity arise? After six years, my partner approached me about collaborating on a deal. Despite my busy schedule, I accepted, recognizing the alignment with my goals and viewing it as a chance to evaluate our compatibility. I entered without expectations, emphasizing my willingness to defer to his expertise regarding compensation. This approach allowed me to showcase my abilities while demonstrating trust in his judgment.Working with such a reputable partner was immensely enjoyable. Despite occasional challenges inherent to the asset class, our collaboration was overwhelmingly positive. Our complementary strengths facilitated smooth teamwork; where one hesitated, the other stepped in confidently.Regarding compensation, we finalized discussions shortly before closing, with my partner proposing a generous split. I initially felt it was overly generous and suggested he retain more. After adjusting, he reiterated his appreciation for the opportunity, attributing his generosity to my demonstrated value and diligence during due diligence.The ultimate outcome will be revealed upon exiting the deal in 2-3 years. So far, however, our webinar presentation garnered full commitment within two hours, and we secured a $100k discount post-webinar, to the delight of our investors.I share this not to boast but to underscore the importance of integrity and patience in forging partnerships. Trust in the process and the individuals involved is paramount. Additionally, competence is non-negotiable; excellence breeds opportunities.In conclusion:Great individuals are rare, and integrity sets one apart. Regardless of age or experience, doing the right thing attracts opportunities. I've witnessed this firsthand, partnering with a diligent 20-year-old whose character and work ethic impressed me consistently.My partner frequently encounters individuals seeking partnerships, yet most fail to invest in building relationships. Approaching someone out of the blue with partnership proposals rarely succeeds. I echo this sentiment; without rapport and shared values, collaboration is unlikely.Send us your feedback about our podcast to: [email protected] up to hear about our investment opportunities here: https://montecarlorei.com/investors/

What are some ways to increase income on a commercial property? Joseph Woodbury, CEO of Neighbor, shares his knowledge.Read this entire interview here: https://tinyurl.com/wewybvt5What kind of fees do you charge and how does it benefit the property owner?We only make money when our partners make money. We don't charge any upfront or recurring fee, free to use the service. Just like an Airbnb or other marketplace, will take whatever you decide to charge as a host and we'll charge the renter a service fee on top of that, and that's where our money comes from.It is a sliding scale take rate based on the size of the dollar amount of the rental. For smaller rentals, if it's $30 a month, we're going to take a high percentage take rate on top, to make the money that you need to, versus we have some spaces that rent out for 1000s of dollars a month, we're going to take a very low percentage take rate on top of that. It varies by the amount. But again, very similar to what you'd see on Airbnb, where it kind of slides based on the amount of the reservation.Have you scaled the operations to cater to your partners who are listing their spaces with you?It's very much scaling the technology. The value of the platform is the value of the tools that we provide. Every year we're trying to think how can we make this more of a passive income experience for our hosts because that is one of our differentiating factors. If you think of other marketplaces, to make money on Uber, there's labor involved, you have to go drive around, or Instacart or DoorDash, and you have to work for the income that you earn. Even Airbnb tends to have a decent amount of management and turnover and customers. Oftentimes, management companies are hired, Neighbor, on the other hand, is the first platform where we can bring you a renter, and you're going to get a payment from that renter every month without doing much of anything, it's very passive income.Further along in the business, we've gotten the bigger hosts and have started to use the platform to where today. We have hosts that may own a $30 billion real estate portfolio across the country, office or retail or multifamily and they're listing lots of space on our platform in 100 cities. The tools required to manage that amount of space are very different than the tools required to manage a driveway or a garage. And so, building more robust payment systems to work with any large enterprises, custom payment systems, or building tools, almost like SAS-type tools where you can see the layout of hundreds of spaces and assign renters to different spaces, we use this cool tool called a blueprint for large owners of the land...Can you share an example of a REIT or a larger investor that has onboarded some properties with Neighbor and how did that go?In the retail space, we work with a group called Federal Realty, one of the largest owners of retail space in the country both on the East Coast and the West Coast. We onboarded them, we work with them both the suites that struggled to rent then will rent those out for self-storage, and also the parking in a strip mall. There's always that parking in the back that nobody parks on, we've rolled out nationwide with them.On the multifamily side, an example of one of the many multifamily groups we work with is Equity Residential, one of the largest owners in the country. In some properties, they have 20 different vacant parking stalls while in some properties, they have five, but at every property, they have and it's all income, and those properties get leased up very fast. If I look at properties that are onboarded, they get up to 75-80% occupancy quickly. And then, when you add on the interior self-storage opportunity...

How to find, analyze, and convert small boutique hotels? What are the systems and tools to use and the processes for hiring top people? Blake Dailey, a real estate investor, owner of boutique hotels, and founder of BoutiqueHotelCon, shares his knowledgeRead this entire interview here: https://tinyurl.com/yevhs2u3How long did it take you to surpass your W2 income after you started investing?It took 13 months from the time of purchase. Short-term rentals helped me achieve that goal more quickly.How do you find a small boutique hotel? How do you analyze it, including conversions, if you undertake them?Municipalities across the country are increasingly regulating short-term rentals in places like New York, Dallas, Atlanta, and Southern California. These regulations aim to protect the single-family housing market and the rental market. Hotels, classified as commercial properties, are designed for nightly rentals and thus aren't subjected to the same regulations. Authorities aren't shutting down major hotel chains like Marriott and Hilton due to the influence of hotel lobbyists. This lack of regulation provides an opportunity to invest in prime real estate in metropolitan areas or their suburbs.To find these opportunities, I seek out tired hospitality assets typically owned by Mom-and-Pop operators who often reside on-site and handle all management tasks themselves. The inefficiencies of managing a business where you both live and work can be substantial. Many of these operators are slow to adopt technology, neglect online travel agencies (OTAs), and fail to engage in marketing efforts beyond word-of-mouth referrals or basic direct booking websites. By acquiring these properties, refreshing and renovating them, and listing them on OTAs such as Airbnb, booking.com, and Expedia hotels.com, we can attract a wider range of guests. We also focus on collecting guest emails and contact information to facilitate direct marketing efforts, which can significantly increase margins by avoiding OTA fees.We target markets such as destination markets, ski towns, and beach towns. For instance, Panama City Beach attracts 17 million visitors annually. However, similar opportunities exist in various markets nationwide, including metropolitan areas. I've found success in acquiring outdated properties owned by owner-operators, improving their efficiency, updating their design, and consequently increasing their average daily rates (ADRs). Since commercial properties are valued based on net operating incomes, these improvements can significantly boost property values.Can you discuss your systems, processes, and approaches to hiring and developing your team?Investing in this asset class requires a team effort. I couldn't manage all my hotels alone, although I did gain experience managing all my short-term rentals while still involved in residential properties. I outsourced administrative tasks and guest communications to cope with increased demand. Boutique hotels generate revenue from the outset, enabling us to hire and outsource roles early on. For instance, with a property generating hundreds of thousands of dollars annually, we can afford a full property-level team, including a director of operations, operations manager, revenue manager, and guest relations team. Regarding guest check-in processes, we employ self-check-in systems for smaller properties, while larger properties with higher revenue may warrant on-site staffBlake Daileywww.instagram.com/blakejdaileywww.botiquehotelcon.com

What are the top lessons learned over a four-decade real estate investing career? What are his thoughts on the current real estate investing market compared to other difficult markets that he has been through in the past? Is there such a thing as work-life balance? We are chatting with Stephen Bittel, Chairman and founder of Terranova Corporation, he manages their sizeable portfolio of properties in several asset classes such as retail, multi-family and office. Read this entire episode here: https://tinyurl.com/2s3u5u3yWhat is like investing today compared to the past?This is the hardest investment market we have ever participated in. There's staggering uncertainty about the future, with half of the pundits predicting a recession and others foreseeing a soft landing. People simply don't know what's coming, and this uncertainty freezes both debt and equity capital.Part of the challenge today is that most of the people making investment decisions have only experienced an era of continually declining interest rates and cap rates, where you didn't have to be particularly skilled to make money. However, the current situation is different. While there was a brief interruption in the last quarter of 2008 and 2009, the past 15 years, and even longer for those under 50, have been relatively stable. Positive leverage, which used to be a hallmark of real estate investing, is now extremely difficult to achieve. In the past, we could finance properties at lower rates than their initial yield, resulting in immediate profitability. However, achieving such positive leverage today is nearly impossible. Despite this, we continue to invest in properties with tighter yields if we see opportunities to increase income.What are some of the toughest lessons learned, and what advice would you give without someone having to experience it themselves? Managing cash flow is crucial both corporately and at the property level. We've always prioritized managing our balance sheet, promptly paying down debt after liquidity events. The key lessons are:Invest in projects with potential for revenue growth, especially in areas experiencing positive population growth.Establish strong capital partnerships, as demonstrating the ability to close deals is vital. Seller financing can be advantageous for both parties.Consider being a nonrecourse borrower to protect against personal liability in challenging times.Honor loan covenants, and prioritize maintaining a clean balance sheet.Regarding nonrecourse loans, although they may incur slightly higher costs, the benefits of a clean balance sheet outweigh the expense. While our model may not be replicable for everyone, I would advise paying the premium for nonrecourse loans if given the choice.Commercial real estate is a fantastic industry with long-term wealth-building potential. While it's not without challenges, such as the current uncertainty in the market, it offers numerous advantages, including tax benefits and opportunities for cash-out financing. It's essential to treat real estate investment as a full-time commitment and to prioritize understanding the details of every transaction. Ultimately, success in this industry requires dedication, hard work, and a deep understanding of market dynamics.Stephen Bittel [email protected] our newsletter here: www.montecarlorei.com

We continue our education of the history of The Irvine Company, picking up where we left of  in the 1980's through 2013. Excerpts from the book: The Irvine Ranch: a Time for People" by Martin A. Brower. Read this entire episode here: https://tinyurl.com/y6s85em4About 4,000 residential ground leases made over a 15-year period were coming up for renewal. The new rent, set at 5, 6, or 7% of the fair market value of the land, had been written so that rent would remain flat for an original 20 or 25 years. At expiration, the Company could charge 5, 6, or 7% of the new fair market value, but few foresaw how steeply land values would rise during the two decades. The residents created a Committee of 4000 to ask the company to discard the leases they had signed and to obtain more favorable conditions. They secured extensive news media coverage, took advertisements, held mass rallies, and won favorable community support, and as a result, the Company’s credibility plummeted. The Company made the Committee of 4,000 a new offer. The leaseholders could buy their land at an average of 50% of its appraised market value, and because interest rates were high, the Company would permit homeowners to pay for the land over a 30-year period with a variable-rate loan beginning at 10% - an acceptable interest rate in the mid-1980s.Key takeaways:Donate land to create a university or anything that will attract a lot of people to live in the area, build around it.Donate a lot to the community to help your company have a good public image.There were many trials and tribulations, even when the city entitled something; some activists were able to reverse that.They went through all economic cycles. They very rarely, if ever, sell, which is something I fully believe and agree with.I heard from someone familiar with being a tenant that they are very strict landlords; you can’t have one thing out of place.I personally looked at some of their multifamily apartments, and they are very well run.He is very particular about how things look; he would remove trees that looked “old school” and put palm trees to make a certain area look better, and now I notice that every shopping center he owns has palm trees.He made his execs work very hard; I met someone here that knew one of his VPs, and when this VP was taking a vacation, Bren made him come back to work due to a problem, and it turned out that the problem wasn’t that big of a deal. To me, what that says is that the VPs were highly paid, and also that we all need to resolve an issue very quickly when it arises at that level, or at any level, in my opinion. Don’t ever let things linger.Nothing lasts forever; if you made a mistake on one thing here, you fix it for the next one.Key takeaways on purchasing The Irvine Company:Be where the people are, go to the events that they go to, be in front of them. One of the partners that Bren had was at a horseshoe, and he ran into an Irvine Company family member, and that started the conversation of “has the ranch been sold yet,” which led to this person partnering up with multiple people, including Bren, to make the initial 50% purchase.Talk to the people who will get the deal done, in this case, they contacted the same lender. Bren always worked with the top people in the industry, whether they were CPAs, attorneys, lenders. Always go to the top for a significant opportunity.Get the seller what they want, in this case, one of the heiresses, Joann, to be a 10% stakeholder on that initial purchase.Corporations have a target number they will stop bidding at; this one was just under 20x of annual earnings, this one 3 million below the 20x annual earnings.Subscribe to our...

We continue the introduction to the richest real estate investor in the globe, the owner of The Irvine Company, Donald Bren.Read the entire episode here: https://tinyurl.com/m2ehfys71970'sAt that point, cities and the County were increasingly imposing costly demands on the developer. These demands included roads, flood control channels, parks, and schools — all of which were previously provided by the cities and the County. The James Irvine Foundation became serious about selling The Irvine Company to comply with the Tax Reform Act. When thinking of purchasing the company, Bren combined forces with Taubman, Allen, and the others. Understanding from Bren the need to have heiress Joan Irvine Smith on their side, Taubman and Bren had decided to allow Joan Irvine Smith to become an 11% partner of the consortium, allowing her to retain partial ownership of the Company she loved after the proposed purchase — which she relished. On May 18, 1977, Mobil bid $336.6 million. The next day, May 19, the consortium bid $337.4 million — more than one-third higher than Mobil's original offer. At noon the following day, May 20, 1977, Mobil announced that it would not attempt to outbid the consortium. The consortium was prepared to go higher. The court approved the price, declared Taubman-Allen-Irvine the winner, and the sale of The Irvine Company was completed. Therefore, 112 years after James Irvine acquired the Irvine Ranch, the company became a Michigan corporation.The consortium purchased the company for $337.4 million. Key to the financing of the acquisition was the $100 million loan, which was assembled by a group of 9 banks. The timing of the acquisition could not have been better, as the nation came out of the 1973-74 recession, and the economy grew warm in 1976 and 1977.1980'sIn 1983, Bren made a startling move. He offered to buy out Taubman and his partners by launching his own leveraged buyout of The Irvine Company, for their 51 percent of the Company, for which they had contributed less than $100 million six years earlier, Bren offered the “Eastern” shareholders $516 million. Determining that they had made a sizeable profit and uncertain about the future resulting from the heated “greedy eastern carpetbagger” campaign and the residential leasehold crisis, the Taubman-led easterners agreed to accept Bren’s offer. Orange County newspaper reporters tried to uncover why these astute businessmen would sell a company which appeared to have an unlimited financial future, but Taubman would only comment “My father always told me you take some and you leave some.” To his hometown “Detroit Free Press” he boasted: “This was a better deal than the Louisiana Purchase.” But Joan Irvine Smith objected to the buyout price as being too low, and objected to Bren’s saddling the Company with a $560 million debt (the $516 million buyout plus interest due to five banks making the loan). This valued the company at just over $1B and her 11% shares at about $100M. She filed suit. With the buyout also came $560M of debt. Bren worked with First Boston Company on financing the buyout, and he worked closely with accountants Kenneth Leventhal & Company on how to make the payments. The lawsuit lasted quite a few years in the 80s and after endless months of discovery, depositions, the trial which was in Michigan (where the company was incorporated) resulted in the judge awarding her $256M including accumulated interest.Join our newsletter here: www.montecarlorei.com

A little background on the history of The Irvine Company.Read this entire episode here: http://tinyurl.com/55zadwbjIn 1864, James Irvine and three partners bought a 101,000-acre ranch, for around $26k. Much of that is now a city called Irvine, in California. It was initially a ranch focused on agriculture and it also encompassed coastal land. In the early 1900’s they started developing some of the real estate, and in the 1950’s they started large scale planned community development, also known as master planned communities, which encompasses building everything from residential to commercial and industrial buildings. The city of Irvine became one of the largest planned communities in the US.I recently read the book The Irvine Ranch: A Time For People by Martin A. Brower, and I will be sharing what I highlighted from the book below for my own knowledge.50'sNovices in such real estate transactions, The Irvine Company prepared lease and sale agreements which did not require development as proposed nor reversion of the land to the Company if not used by the lessee or purchaser.60'sAs they were expanding and continuously growing, one of their developments in the 60’s pioneered the “zero lot line” concept, in which a house is placed on its neighbor’s property line, resulting in one wide side yard rather than two small and useless side yards for each home. The unique plan placed groups of homes around a series of central green parks. Homes were priced from $27,000 to $32,000, a step below the prices in Turtle Rock Hills.As with all other Irvine Company village centers, included architecture consistent with its community, an attractive service station with pumps away from the streets, and with a supermarket and shops opening from a broad walkway rather than directly from the parking lot.Master planned to group buildings by size and use, the IIC was developed with strict covenants regulating land coverage, architectural design, landscaping and sound, odor and visual emissions. They were known for their innovative planning concepts.70’sThe Company’s Residential Division had developed strict guidelines for each village which builders had to obey if they wanted to be invited to build homes on the Ranch. One of the homebuilders in Greentree — The Bren Company — was felt not to be cooperating. It was determined that Bren would never again be invited to build on the Irvine Ranch.When a citizen spokesman completed an attack one of of the Irvine company’s plan for a new project and the city stood with him, the president at the time Raymond Watson, applauded. “You’re not supposed to applaud,” chided Company director of public relations Martin Brower. “Sure I am, this is real democracy in action, with each of us respecting the other’s role”.We will continue this exploration on the next post as I will highlight how Donald Bren became a partial owner of The Irvine Company and how he then became the sole owner of The Irvine Company.Subscribe to our newsletter here: www.montecarlorei.com